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What are NFTs? How to Create and Sell NFTs? | by Dinesh Jain

Source: Google Images

A non-fungible token aka NFT is a type of cryptographic token that represent unique asset. NFT are tokenized version of digital or real-world asset. NFTs functions as proof of authenticity which can be verified and ownership within a blockchain network. NFT is not interchangeable with each other and introduces scarcity to digital world.

Fungibility as the property means that there’s an asset whose individual units are interchangeable and indistinguishable from each other. Example, all fiat currencies are fungible, means you can interchange a Rs. 2000 note with ten Rs.200 note.

Source: Google Images

It could be a house, a painting such as of our national flower LOTUS, which is one of a kind. You can take a photo of the painting undoubtedly or buy a print from the market but there will only ever be one original painting.

NFTs can be used by decentralized application to allow for the creation or for the ownership of unique digital items and collectible. NFTs, which can be traded in open marketplaces connecting buyer with sellers, it is worth noting that the value of each NFT remain unique. The first application based on NFTs to reach to the widespread adoption was a virtual online game known as CryptoKitties.

Source: Google Images

The standardization of NFTs allows a higher degree of interoperability (means that the unique asset can be transferred between applications with relative ease).

Source: Google Images

NFTs have the potential to be one of the key components of a new blockchain-powered digital economy and we have seen in 2021 how NFTs sales hit a massive amount of $25 billion. NFTs could be used in many different fields, such as video game, digital identity, licensing, certificate, or fine art — and even allow fractional ownership of items. Store of ownership and identification data on the blockchain would increase data integrity along with privacy, while easy transfers and management of these asset could reduce friction in trade and the global economy.

The process for the creation of non fungible tokens (NFTs) is known as minting. NFTs are developed in an NFT marketplace such as OpenSea NFT Marketplace , where a creator uploads a digital file(maybe PNG or JPeg) and determines if it is a one-of-a-kind item. It comes in a large number of copies or is part of a series(such as crypto punks).

Source: Google Images

The NFT after creation is sold by its owner in the marketplace through an auction(where buyer can bid for that NFT). Currently, the majority of NFTs are operating on Ethereum Blockchain. Other blockchains, like WAX, FLOW, BNB can also be used.

Source: Google Images

Important points on how NFTs add value is as follows:

  • Scarcity: Scarcity means that the demand for a good or services is greater than the availability of the good or service. The development company developing your NFT will be responsible for the scarcity of your digital asset.
  • Each NFT will have a unique id with only one owner and the scarcity of an NFT can be determined by the developer.
  • Royalties: When NFT is sold, its developers receive some royalties. (That is if you have made NFT and sold you will still receive royalty while your NFT is being sold or bought). Even though the idea is new but it has proven to be powerful.
Source: Google Images

Some of the advantages are:

  1. Limited
  2. Indivisible
  3. Unique
  4. Easily Transferable
  5. Trustworthy
  6. Maintain Ownership Rights
OpenSea
  1. Buy some cryptocurrency to fund your wallet: Here you need to buy some crypto in CoinDCX account so that you can fund your account.
  2. Create a digital wallet to pay for your NFT: Now make your account in MetaMask to link to opensea account to buy/sell your NFT.
  3. Add some cryptocurrency to your wallet: Now transfer crypto (ETH) to fund your MetaMask account.
  4. Connect your wallet to an NFT platform: Then connect MetaMask account to opensea.
  5. Upload the file you want to turn into an NFT.
  6. Set up an auction for your NFT
  7. Add a description to sell your NFT
  8. Pay the listing fee to sell your NFT (but be warned!)
Buy Ethereum or required crypto to fund your MetaMask Wallet

The possibilities for NFT are wide open and one can make almost every collectible item into an NFT. Some of them are as;

  1. Music: Music won’t ever degrade over time which is why it’s so easy to resell it.
Source: Google Images

2. Digital Art: Digital art can be in the form of videos, gifs, images, and more. You may be familiar with crypto punk; that’s digital art.

Source: Google Images

3. In-game Items: In-game items is popular type of NFT. In-game item refers to an item that you can earn or purchase or trade or find in a game.

4. Real-world Items: Any real-world item that meet the criteria can be an NFT, considering you’re able to prove its ownership. Examples of real-world item as NFT are: document, property deeds, ticket, celebrity autograph etc.

Hopefully, this guide gave you a better understanding and sight of NFTs and how you can invest/sell/create/buy them. The future of owning is likely to be more of a digital world.

We discussed about NFTs its advantages and real meaning. Then we saw how to Create and Sell NFTs? and then NFT buying guide.

Hope you enjoyed today’s blog. See you next week.

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